The world's worst debtor in history, Argentina, is preparing to tell its creditors to forget about getting paid - again.

"This year should be fine, there is enough money to pay off what it owes, but next year looks very different," says Eugenio Bruno, a Buenos Aires lawyer specialising in international debt issues. Argentina owes more than $20bn (£13.9bn) this year alone from a combination of debts falling due and servicing charges. Some Argentinian dollar-denominated bonds are yielding more than 50%, a staggering rate that presumes a default is likely to happen.

The government debt is now $150bn, which is higher than it was during Argentina's last default in 2002, when the country was virtually "left out of the world".

In that economic crisis, involving nearly $100bn, the government offered creditors just 35-65 cents in the dollar. Some are still fighting to get their money back. The government is due to repay $14bn this year and $10bn next year. And the 2002 default means Argentina has absolutely no access to international capital markets.

Its only saviour has been Hugo Chávez, Venezuela's president, who purchased more than $7bn in bonds with oil profits, albeit forcing Argentina to pay extremely high interest rates. But the sharp drop in the price of oil has cut off that particular supply of money. And with Argentina's exports shrinking by more than half, its foreign currency coffers are emptying.

As if this were not bad enough, the country is now sliding into a recession. Optimistic estimates show gross domestic product shrinking by at least 2.5% and the government is now wildly spending money to stimulate the economy.

President Cristina Fernández de Kirchner is unable take her presidential jet, Tango One, overseas, because it is likely to be seized by angry creditors. "It all adds up to a messy picture," said Tomas Sánchez, an economist. "Everything together is going to make it very hard for the government to avoid default, probably early next year."

Now there is a growing political tide in favour of such a default. A former president, Eduardo Duhalde, has said that Argentina is already an international financial pariah, and "should just default and protect our foreign reserves".